Martin v. Granite City Steel Corp.

• Citation: 596 F. Supp. 293
• Decision Date: 22 October 1984
• Docket Number: Civ. No. 84-3125.
• Parties: Lionel MARTIN, et al., Plaintiffs, v. GRANITE CITY STEEL CORPORATION, an Illinois corporation, and Granite City Steel Division of National Steel Corporation, Defendants.
• Court: U.S. District Court — Southern District of Illinois

596 F. Supp. 293

Lionel MARTIN, et al., Plaintiffs, v. GRANITE CITY STEEL CORPORATION, an Illinois corporation, and Granite City Steel Division of National Steel Corporation, Defendants.

Civ. No. 84-3125.

United States District Court, S.D. Illinois.

October 22, 1984.

COPYRIGHT MATERIAL OMITTED

Richard Shaikewitz, Wiseman, Shaikewitz, McGiven & Wahl, Alton, Ill., for plaintiffs.

R. Eric Robertson, Lueders, Robertson & Konzen, Granite City, Ill., J.F. McKenna, III, and C.R. Babst, III, Thorp, Reed & Armstrong, Pittsburgh, Pa., for defendants.

MEMORANDUM AND ORDER

FOREMAN, Chief Judge:

Plaintiffs filed this action in the Circuit Court, Third Judicial Circuit, Madison County, Illinois, alleging that the defendants, by recycling coal by-products into their coke ovens, intentionally exposed the plaintiffs to toxins and carcinogens. The plaintiffs seek to represent a class of all persons who have worked for the Granite City plant since June of 1982 and all nonemployees who have lived within a five mile radius of the plant since June of 1982. The Complaint specifically alleges that some class members have suffered damages less than $10,000 and some have suffered damages in excess of $15,000. In addition, the plaintiffs seek punitive damages, attorney's fees, and equitable relief in that the defendants be required to provide and pay for complete physical testing and medical attention to all class members, and that the defendants cease the recycling procedure. The defendants removed the case to the United States District Court for the Southern District of Illinois.

The main motion before the Court is plaintiffs' Petition to Remand. Plaintiffs contend that since some class members' claims are for less than $10,000, the case cannot be removed. Defendants argue that the prayer for punitive damages, attorney's fees, and full medical attention bring the claims of these class members over the $10,000 barrier, but that in any event, this Court has jurisdiction over the less than $10,000 claims pursuant to 28 U.S.C. § 1441(c) since these claims are separate and independent.

DISCUSSION

28 U.S.C. § 1441(a) provides that any civil action brought in a state court of which the district courts of the United States have original jurisdiction, may be removed by the defendants to the federal district court embracing the place where the state action is pending. Since this is not a federal question case, the Court would have proper removal jurisdiction if the case met the requirements of a diversity action. Generally, a diversity action requires that there be complete diversity of citizenship between the parties and that the amount in controversy exceeds $10,000. See 28 U.S.C. § 1332. The removing party has the burden of establishing diversity of citizenship together with the requisite jurisdictional amount. McNutt v. General Motors Acceptance Corp., 298 U.S. 178, 56 S.Ct. 780, 80 L.Ed. 1135 (1936).

There appears to be complete diversity in this case. In a class action,¹ the courts look only to the citizenship of the representative parties. Snyder v. Harris, 394 U.S. 332, 340, 89 S.Ct. 1053, 1058, 22 L.Ed.2d 319 (1969). Hence, the named plaintiffs are all residents of Illinois. The two named defendants are Granite City Steel Company and Granite City Steel Division of National Steel Corporation. Granite City Steel Division is a Delaware corporation with its principal place of business in the State of Pennsylvania. Granite City Steel Company is an Illinois corporation. However, the defendants have moved to drop Granite City Steel Company as a misjoined party stating that it is merely a holding company, and as such is not a necessary, indispensable, or real party in interest. Plaintiffs respond by asking that the motion to drop a misjoined party be denied until such time as the plaintiffs have an opportunity to discover the role of the holding company. In any event, the plaintiffs did not raise the citizenship problem in their Petition to Remand. Further, this Court has already held that Granite City Steel Company (the holding company) has no interest in such a lawsuit. Niemeyer v. Granite City Steel Company, No. 83-3333 (S.D.Ill. Dec. 16, 1982) (order denying motion to remand). Therefore, the defendants' motion to drop the misjoined party is granted.

The Supreme Court has held that for class actions all class members must meet the amount in controversy requirement when jurisdiction is asserted on the basis of § 1332. Zahn v. International Paper Co., 414 U.S. 291, 94 S.Ct. 505, 38 L.Ed.2d 511 (1974). The principle is equally applicable to remand situations. See 1A Moore's Federal Procedure ¶ 0.157. The defendants do not contest this fact, but rather assert that punitives, attorney's fees, and the value of equitable relief sought should be included in determining whether the amount in controversy requirement has been met.

With regard to attorney's fees, they may be included in the jurisdictional sum if they are allowed by statute or provided for by contract. Wright, Miller & Cooper, Federal Practice and Procedure: Jurisdiction § 3712. Additionally, when the applicable substantive law makes the award of attorney's fees discretionary, a claim that this discretion should be exercised in favor of the plaintiffs makes the requested fee part of the amount in controversy. Id. One court has held, however, that when the court's discretion forms the basis for the award of attorney's fees, the plaintiff must allege a specific amount. Blank v. Preventive Health Programs, Inc., 504 F.Supp. 416 (S.D.Ga.1980). In an event, under Illinois law, there exists no statutory authorization for attorney's fees nor does the Court have the power to award them. Therefore, attorney's fees cannot be included in the calculation.

With respect to punitive damages, the Supreme Court has held that they can be included in determining the amount in controversy requirement if under the governing law of the suit they are recoverable. Bell v. Preferred Life Assurance Soc., 320 U.S. 238, 64 S.Ct. 5, 88 L.Ed. 15 (1943). Thus, if the plaintiffs can recover punitive damages under Illinois law, the amount of such damages must be included in the calculation. Jeffries v. Silvercup Bakers, Inc., 434 F.2d 310 (7th Cir.1970).

Punitive damages are allowed in Illinois where a defendant has acted wilfully or with such extreme negligence as to indicate reckless disregard for the safety of others. Hazelwood v. Illinois Central Gulf R.R., 114 Ill.App.3d 703, 71 Ill.Dec. 320, 450 N.E.2d 1199 (1983). The plaintiffs in the instant case seek punitive damages because the defendants acted intentionally. Therefore, punitive damages must be taken into account in determining the amount in controversy.

With regard to the equitable relief sought, a valuation of the amount in controversy is a complex task. A court must not only undertake to...